0001190370 true --10-31 Q3 2023 0001190370 2022-11-01 2023-07-31 0001190370 2023-09-22 0001190370 2023-07-31 0001190370 2022-10-31 0001190370 2023-05-01 2023-07-31 0001190370 2022-05-01 2022-07-31 0001190370 2021-11-01 2022-07-31 0001190370 us-gaap:CommonStockMember 2022-10-31 0001190370 ivdn:CommonStockToBeIssuedMember 2022-10-31 0001190370 us-gaap:AdditionalPaidInCapitalMember 2022-10-31 0001190370 us-gaap:RetainedEarningsMember 2022-10-31 0001190370 us-gaap:CommonStockMember 2023-01-31 0001190370 ivdn:CommonStockToBeIssuedMember 2023-01-31 0001190370 us-gaap:AdditionalPaidInCapitalMember 2023-01-31 0001190370 us-gaap:RetainedEarningsMember 2023-01-31 0001190370 2023-01-31 0001190370 us-gaap:CommonStockMember 2023-04-30 0001190370 ivdn:CommonStockToBeIssuedMember 2023-04-30 0001190370 us-gaap:AdditionalPaidInCapitalMember 2023-04-30 0001190370 us-gaap:RetainedEarningsMember 2023-04-30 0001190370 2023-04-30 0001190370 us-gaap:CommonStockMember 2021-10-31 0001190370 ivdn:CommonStockToBeIssuedMember 2021-10-31 0001190370 us-gaap:AdditionalPaidInCapitalMember 2021-10-31 0001190370 us-gaap:RetainedEarningsMember 2021-10-31 0001190370 2021-10-31 0001190370 us-gaap:CommonStockMember 2022-01-31 0001190370 ivdn:CommonStockToBeIssuedMember 2022-01-31 0001190370 us-gaap:AdditionalPaidInCapitalMember 2022-01-31 0001190370 us-gaap:RetainedEarningsMember 2022-01-31 0001190370 2022-01-31 0001190370 us-gaap:CommonStockMember 2022-04-30 0001190370 ivdn:CommonStockToBeIssuedMember 2022-04-30 0001190370 us-gaap:AdditionalPaidInCapitalMember 2022-04-30 0001190370 us-gaap:RetainedEarningsMember 2022-04-30 0001190370 2022-04-30 0001190370 us-gaap:CommonStockMember 2022-11-01 2023-01-31 0001190370 ivdn:CommonStockToBeIssuedMember 2022-11-01 2023-01-31 0001190370 us-gaap:AdditionalPaidInCapitalMember 2022-11-01 2023-01-31 0001190370 us-gaap:RetainedEarningsMember 2022-11-01 2023-01-31 0001190370 2022-11-01 2023-01-31 0001190370 us-gaap:CommonStockMember 2023-02-01 2023-04-30 0001190370 ivdn:CommonStockToBeIssuedMember 2023-02-01 2023-04-30 0001190370 us-gaap:AdditionalPaidInCapitalMember 2023-02-01 2023-04-30 0001190370 us-gaap:RetainedEarningsMember 2023-02-01 2023-04-30 0001190370 2023-02-01 2023-04-30 0001190370 us-gaap:CommonStockMember 2023-05-01 2023-07-31 0001190370 ivdn:CommonStockToBeIssuedMember 2023-05-01 2023-07-31 0001190370 us-gaap:AdditionalPaidInCapitalMember 2023-05-01 2023-07-31 0001190370 us-gaap:RetainedEarningsMember 2023-05-01 2023-07-31 0001190370 us-gaap:CommonStockMember 2021-11-01 2022-01-31 0001190370 ivdn:CommonStockToBeIssuedMember 2021-11-01 2022-01-31 0001190370 us-gaap:AdditionalPaidInCapitalMember 2021-11-01 2022-01-31 0001190370 us-gaap:RetainedEarningsMember 2021-11-01 2022-01-31 0001190370 2021-11-01 2022-01-31 0001190370 us-gaap:CommonStockMember 2022-02-01 2022-04-30 0001190370 ivdn:CommonStockToBeIssuedMember 2022-02-01 2022-04-30 0001190370 us-gaap:AdditionalPaidInCapitalMember 2022-02-01 2022-04-30 0001190370 us-gaap:RetainedEarningsMember 2022-02-01 2022-04-30 0001190370 2022-02-01 2022-04-30 0001190370 us-gaap:CommonStockMember 2022-05-01 2022-07-31 0001190370 ivdn:CommonStockToBeIssuedMember 2022-05-01 2022-07-31 0001190370 us-gaap:AdditionalPaidInCapitalMember 2022-05-01 2022-07-31 0001190370 us-gaap:RetainedEarningsMember 2022-05-01 2022-07-31 0001190370 us-gaap:CommonStockMember 2023-07-31 0001190370 ivdn:CommonStockToBeIssuedMember 2023-07-31 0001190370 us-gaap:AdditionalPaidInCapitalMember 2023-07-31 0001190370 us-gaap:RetainedEarningsMember 2023-07-31 0001190370 us-gaap:CommonStockMember 2022-07-31 0001190370 ivdn:CommonStockToBeIssuedMember 2022-07-31 0001190370 us-gaap:AdditionalPaidInCapitalMember 2022-07-31 0001190370 us-gaap:RetainedEarningsMember 2022-07-31 0001190370 2022-07-31 0001190370 ivdn:FourInvestorsMember 2022-11-01 2023-07-31 0001190370 ivdn:OneInvestorMember 2023-07-31 0001190370 ivdn:OneInvestorMember 2022-11-01 2023-07-31 0001190370 ivdn:TwoInvestorsMember 2022-11-01 2023-07-31 0001190370 ivdn:TwoInvestorsMember srt:MinimumMember 2023-07-31 0001190370 ivdn:TwoInvestorsMember srt:MaximumMember 2023-07-31 0001190370 ivdn:SevenInvestorsMember 2021-11-01 2022-07-31 0001190370 ivdn:EightInvestorsMember 2021-11-01 2022-07-31 0001190370 ivdn:SevenInvestorsMember srt:MinimumMember 2022-07-31 0001190370 ivdn:SevenInvestorsMember srt:MaximumMember 2022-07-31 0001190370 ivdn:KetutJayaMember ivdn:INSULTEXMaterialMember 2015-07-11 2015-07-12 0001190370 ivdn:KetutJayaMember ivdn:INSULTEXMaterialMember 2022-11-01 2023-07-31 0001190370 ivdn:KetutJayaMember ivdn:INSULTEXMaterialMember 2017-11-01 2018-10-31 0001190370 ivdn:KetutJayaMember ivdn:INSULTEXMaterialMember 2018-11-01 2019-10-31 0001190370 ivdn:KetutJayaMember ivdn:INSULTEXMaterialMember 2023-02-01 2023-02-28 0001190370 ivdn:SeparatePieceOfEquipmentsMember 2021-11-01 2022-10-31 0001190370 ivdn:SeparatePieceOfEquipmentsMember 2022-11-01 2023-07-31 0001190370 ivdn:ApparelMember 2022-11-01 2023-07-31 0001190370 ivdn:ApparelMember 2021-11-01 2022-07-31 0001190370 ivdn:HousewrapMember 2022-11-01 2023-07-31 0001190370 ivdn:HousewrapMember 2021-11-01 2022-07-31 0001190370 2022-06-28 2022-06-29 iso4217:USD xbrli:shares iso4217:USD xbrli:shares xbrli:pure

 

 

UNITED STATES 

SECURITIES AND EXCHANGE COMMISSION

 

WASHINGTON, D.C. 20549

 

FORM 10-Q/A

 

QUARTERLY REPORT PURSUANT TO SECTION 13l OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

 

For the quarterly period ended July 31, 2023

 

OR

 

  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

 

For the transition period from _______ to ________.

 

Commission File Number: 000-51791

 

INNOVATIVE DESIGNS, INC.

(Exact Name of Registrant as Specified in its Charter)

 

Delaware 03-0465528
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

 

124 Cherry Street

Pittsburgh, Pennsylvania 15223

(Address of Principal Executive Offices, Zip Code)

 

(412) 799-0350

(Issuer’s Phone Number Including Area Code)

 

N/A

(Former Name or Former Address, if changed since last report)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of regulation S-T during the preceding 12 months (or such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

 

 

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting Company” in Rule 12b-2 of the Exchange Act.

 

(Check One)

 

Large Accelerated Filer ☐ Accelerated Filer ☐
   
Non-accelerated Filer ☐ Smaller reporting company 

(Do not check if a smaller reporting company)

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No

 

As of September 22, 2023, there were 36,417,560 shares of the Registrant’s common stock, par value $.0001 per share, outstanding.

 

Transitional Small Business Disclosure Format: Yes ☐ No ☒

 

 

 

 

Explanatory Note

 

Please note the Company is filing this form 10-Q/A to correct an inadvertent tag of shell status as being true instead of false in its Ixbrl tagging.

 

No other changes were made.

 

 

 

 

Innovative Designs, Inc.

 

Index

 

Form 10-Q for the Quarter Ended July 31, 2023

 

  Part I -- Financial Information Page No.
     
Item 1. Condensed Financial Statements (Unaudited)  1
     
  Condensed Balance Sheets as of July 31, 2023 (Unaudited) and October 31, 2022  3
     
  Condensed Statements of Operations for the Three And Nine Month Periods Ended July 31, 2023 and 2022 (Unaudited)  4
     
  Condensed Statements of Changes Stockholders’ Equity as of July 31, 2023 (Unaudited) and October 31, 2022  5
     
  Condensed Statements of Cash Flows for the Nine Month Periods Ended July 31, 2023 and 2022 (Unaudited)  6
     
  Notes to the Condensed Financial Statements  7
     
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations  13
     
  Part II -- Other Information  17
     
Items 1, 2, 3, and 4T.  17-18
   
Item 6. Exhibits  19

 

 

 

ITEM 1. CONDENSED FINANCIAL STATEMENTS

 

INNOVATIVE DESIGNS, INC.

 

FINANCIAL STATEMENTS
FOR THE QUARTER ENDED

 

JULY 31, 2023

 

-1-

 

 

  TABLE OF CONTENTS  

 

    PAGE
     
FINANCIAL STATEMENTS:  
     
CONDENSED BALANCE SHEETS   3
     
CONDENSED STATEMENTS OF OPERATIONS 4
     
CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDER’S EQUITY 5
     
CONDENSED STATEMENTS OF CASH FLOWS 6
     
NOTES TO FINANCIAL STATEMENTS   7

 

-2-

 

 

  INNOVATIVE DESIGNS, INC.      
 
  CONDENSED BALANCE SHEETS      
JULY 31, 2023 (UNAUDITED) AND OCTOBER 31, 2022    

  

                 
    July 31, 2023   October 31, 2022
         
ASSETS        
         
CURRENT ASSETS:                
Cash   $ 178,817       263,293  
Accounts receivable, net     82       11,203  
Inventory, net     588,874       494,580  
                 
Total current assets     767,773       769,076  
                 
PROPERTY AND EQUIPMENT, net     24,247       5,960  
                 
OTHER ASSETS:                
Inventory on consignment           1,625  
Deposits on inventory           80,000  
Advance to employees     13,200       13,200  
Deposits on equipment     719,944       607,370  
                 
Total other assets     733,144       702,195  
                 
TOTAL   $ 1,525,164     $ 1,477,231  
                 
 LIABILITIES AND STOCKHOLDERS’ EQUITY                
                 
CURRENT LIABILITIES:                
Accounts payable   $ 275,487     $ 162,063  
Current portion of note payable     20,265       20,128  
Accrued interest of stockholder loans     54,073       46,345  
Current portion of stockholder loans     71,668       110,631  
Accrued expenses     3,778       3,778  
                 
Total current liabilities     425,271       342,945  
                 
LONG-TERM LIABILITIES:                
Long-term portion of note payable     49,530       64,547  
Long-term portion of stockholder loans           66,667  
                 
Total long-term liabilities     49,530       131,214  
                 
STOCKHOLDERS’ EQUITY:                
Preferred stock, $0.0001 par value,                
25,000,000 shares authorized            
Common stock, $0.0001 par value, 100,800,000 shares authorized, and 36,092,560 and 34,650,560 issued and outstanding     3,612       3,467  
Common stock to be issued              
Additional paid-in capital     11,637,980       11,335,184  
Accumulated deficit     (10,591,228 )     (10,335,579 )
                 
Total stockholders’ equity     1,050,363       1,003,072  
                 
TOTAL   $ 1,525,164     $ 1,477,231  

 

The accompanying notes are an integral part of these condensed financial statements.

 

-3-

 

 

  INNOVATIVE DESIGNS, INC.      
 
CONDENSED STATEMENTS OF OPERATIONS     
THREE AND NINE MONTHS ENDED JULY 31, 2023 AND 2022 (UNAUDITED)

 

                                 
    Three Months Ended July 31,   Nine Months Ended July 31,
    2023   2022   2023   2022
                 
REVENUES, net   $ 124,650     $ 135,048     $ 223,546     $ 235,164  
                                 
OPERATING EXPENSES:                                
Cost of sales     76,480       56,224       106,839       109,884  
Selling, general and administrative expenses     124,944       115,384       359,917       545,212  
                                 
Total operating expenses     201,424       171,608       466,756       655,096  
                                 
Income (loss) from operations     (76,774 )     (36,560 )     (243,210 )     (419,932 )
                                 
OTHER INCOME (EXPENSE):                                
Miscellaneous income (expense)           260,000       7,519       260,000  
Interest expense     (6,421 )     (10,710 )     (17,652 )     (34,450 )
Depreciation     (769 )     (373 )     (2,306 )     (1,118 )
                                 
Total other income (expense)     (7,190 )     248,917       (12,439 )     224,432  
                                 
Net income (loss)   $ (83,964 )   $ 212,357     $ (255,649 )   $ (195,500 )
                                 
PER SHARE INFORMATION - UNDILUTED:                                
Net income (loss) per common share     (0.002 )     0.006     $ (0.007 )   $ (0.006 )
                                 
Weighted average number of common shares outstanding     35,656,821       33,845,560       35,339,663       33,845,560  
                                 
PER SHARE INFORMATION - DILUTED:                                
Net income (loss) per common share     (0.002 )     0.006     $ (0.007 )   $ (0.006 )
                                 
Weighted average number of common shares outstanding     36,633,430       34,902,893       36,153,406       34,902,893  

 

The accompanying notes are an integral part of these condensed financial statements.

 

-4-

 

  

  INNOVATIVE DESIGNS, INC.      
 
CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY    

THREE AND NINE MONTHS ENDED JULY 31, 2023 AND 2022 (UNAUDITED)

 

                               
   Common Stock  Common Stock  Additional Paid-In  Accumulated   
   Shares  Amount  To Be Issued  Capital  Deficit  Total
                   
Balance at October 31, 2022   34,650,560   $3,467   $   $11,335,184   $(10,335,579)  $1,003,072 
                               
Sale of stock   500,000    50        109,950        110,000 
                               
Shares issued for services   27,000    3        5,937        5,940 
                               
Net income (loss)                   (59,094)   (59,094)
                               
Balance at January 31, 2023   35,177,560    3,520        11,451,071    (10,394,673)   1,059,918 
                               
Sale of stock                        
                               
Shares issued for services                        
                               
Net income (loss)                   (112,591)   (112,591)
                               
Balance at April 30, 2023   35,177,560    3,520        11,451,071    (10,507,264)   947,327 
                               
Sale of stock   695,000    70        140,931        141,000 
                               
Exercise of warrants   40,000    4        9,996        10,000 
                               
Shares issued for services   180,000    18        35,982        36,000 
                               
Net income (loss)                   (83,964)   (83,964)
                               
Balance at July 31, 2023   36,092,560    3,612        11,637,980    (10,591,228)   1,050,363 
                               
Balance at October 31, 2021   33,315,560   $3,333   $   $11,039,118   $(10,110,090)  $932,361 
                               
Sale of stock   340,000    34        60,966        61,000 
                               
Shares issued for services   50,000    5        9,995        10,000 
                               
Net income (loss)                   (132,040)   (132,040)
                               
Balance at January 31, 2022   33,705,560    3,372        11,110,079    (10,242,130)   871,321 
                               
Sale of stock   120,000    12        25,188        25,200 
                               
Shares issued for services   700,000    70        174,930        175,000 
                               
Net income (loss)                     (275,816)   (275,816)
                               
Balance at April 30, 2022   34,525,560    3,454        11,310,197    (10,517,946)   795,705 
                               
Sale of stock                        
                               
Shares issued for services                        
                               
Net income (loss)                   212,357    212,357 
                               
Balance at July 31, 2022   34,525,560   $3,454   $   $11,310,197   $(10,305,589)  $1,008,062 

 

The accompanying notes are an integral part of these condensed financial statements.

 

-5-

 

 

  INNOVATIVE DESIGNS, INC.      
 
CONDENSED STATEMENTS OF CASH FLOWS   

NINE MONTHS ENDED JULY 31, 2023 AND 2022 (UNAUDITED)

 

                 
    Nine Months Ended July 31,
    2023   2022
         
CASH FLOWS FROM OPERATING ACTIVITIES:                
Net income (loss)   $ (255,649 )   $ (195,500 )
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:                
Bad debt expense            
Common stock issued for services     41,940       185,000  
Depreciation     2,306       1,118  
Amortization of right of use asset           30,510  
Gain on sale of asset     (7,519 )      
(Increase) decrease from changes in:                
Accounts receivable     11,121       (8,412 )
Inventory     (92,669 )     11,104  
Deposits on inventory     80,000       (40,000 )
Receivable due           (260,000 )
Increase (decrease) from changes in:                
Accounts payable and accrued expenses     113,424       45,826  
Accrued interest expense     7,728       (2,640 )
                 
Net cash provided by (used in) operating activities     (99,318 )     (232,994 )
                 
CASH FLOWS FROM INVESTING ACTIVITIES:                
Purchase of equpment     (20,593 )      
Deposits on equipment     (112,574 )     (7,370 )
Proceeds from sale of equipment     7,519        
                 
Net cash provided by (used in) investing activities     (125,648 )     (7,370 )
                 
CASH FLOWS FROM FINANCING ACTIVITIES:                
Proceeds from sale of stock     261,000       86,200  
Payments on shareholder advances     (105,630 )     (135,667 )
Payments on lease liability           (30,510 )
Proceeds on notes payable           1,818  
Payments on notes payable     (14,880 )     (2,418 )
                 
Net cash provided by (used in) financing activities     140,490       (80,577 )
                 
NET INCREASE (DECREASE) IN CASH     (84,476 )     (320,941 )
                 
CASH, BEGINNING OF YEAR     263,293       480,451  
                 
CASH, END OF THE PERIOD   $ 178,817     $ 159,510  
                 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:                
                 
Cash paid for interest   $ 9,924     $ 37,090  
                 
Non-cash financing activities - common stock issued for services   $ 41,940     $ 185,000  

 

The accompanying notes are an integral part of these condensed financial statements.

 

-6-

 

 

INNOVATIVE DESIGNS, INC.

 

NOTES TO FINANCIAL STATEMENTS

 

  

1.BASIS OF PRESENTATION

 

In the opinion of management, the accompanying unaudited financial statements contain all adjustments necessary to present fairly Innovative Designs, Inc.’s (the “Company”) financial position as of July 31, 2023, the changes therein for the three and nine month periods then ended and the results of operations for the three and nine month periods ended July 31, 2023 and 2022.

 

The financial statements included in the Form 10-Q (the “Form”) are presented in accordance with the requirements of the Form and do not include all of the disclosures required by accounting principles generally accepted in the United States of America. For additional information, reference is made to the Company’s annual report on Form 10-K for the fiscal year ended October 31, 2022. The results of operations for the three and nine month periods ended July 31, 2023 and 2022 are not necessarily indicative of operating results for the full year.

 

 

2.GOING CONCERN

 

These financial statements have been prepared on a going concern basis, which implies that the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company had a net loss of ($255,649) and a negative cash flow of ($84,476) for the nine month period ended July 31, 2023. In addition, the Company has an accumulated deficit of ($10,591,228). Management’s plans include cash receipts through sales, sales of Company stock, and borrowings from private parties. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial statements. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

 

3.ACCOUNTS RECEIVABLE

 

Accounts receivable are reported at their net realizable value. The Company evaluates its receivables on a quarterly basis to assess the validity of remaining receivables. Management has determined that there is significant doubt regarding the receivable balance over 90 days. There were no balances over 90 days as July 31, 2023. As of October 31, 2022, balances over 90 days totaled $5,860 which have been recorded as an allowance.

 

-7-

 

 

INNOVATIVE DESIGNS, INC.
NOTES TO FINANCIAL STATEMENTS
 

 

4.OPENING AND CLOSING BALANCE OF RECEIVABLES

 

The opening balance of accounts receivable was $11,203 which was net of the allowance for doubtful accounts of $5,860. The ending balance of accounts receivable for the nine month period ended July 31, 2023 was $82. There was not an allowance for doubtful accounts at the end of the period.

 

 

5.INVENTORY

 

Inventory consists principally of purchased apparel inventory and house wrap which is manufactured by the Company. Inventory is stated at the lower of cost or net realizable value on a first-in, first-out basis. The Company has decided to discontinue the manufacturing of its Artic Armor, hunting and swimming line of apparel. The Company has booked a reserve against apparel inventory as of July 31, 2023 and October 31, 2022 of $75,468. Management has determined that no allowance is currently necessary on the house wrap inventory. Management will continue to evaluate its obsolete inventory reserve throughout the year and make adjustments as needed.

 

 

6.WARRANTIES

 

The Company provides a ten-year limited warranty covering defects in workmanship. These warranties are included in the contract and do not provide customers with a service in addition to assurance of compliance with agreed-upon specifications. The Company does not consider these assurance-type warranties to be separate performance obligations.

 

Management has determined that no warranty reserve is currently necessary on the Company’s products. Management will continue to evaluate the need for a warranty reserve throughout the year and make adjustments as needed.

 

 

7.NOTE PAYABLE

 

During 2005, the Company entered into an agreement with the U.S. Small Business Association. The note is payable in monthly installments of $1,820 with the balance due and payable in November 2026, at an interest rate of 2.60%.

 

 

8.STOCKHOLDER LOANS

 

Stockholder loans to the Company, including accrued interest totaled $125,741 and $226,793 as of July 31, 2023 and 2022, respectively. The loans bear interest between 10% and 12%.

 

-8-

 

 

INNOVATIVE DESIGNS, INC.
NOTES TO FINANCIAL STATEMENTS
 

 

9.REVENUES

 

Revenues are measured based on the amount of consideration specified in a contract with a customer. The Company recognizes revenue when and as performance obligations (i.e., obligations to transfer goods and/or services) are satisfied, which generally occurs with the transfer of control of the goods or services to the customer.

 

To determine proper revenue recognition, the Company evaluates whether two or more contracts should be combined and accounted for as a single contract and whether a combined or single contract should be accounted for as more than one performance obligation. This evaluation requires significant judgment, and the decision to combine contracts or separate a combined or single contract into multiple performance obligations could change the amount of revenue and profit recorded in a given period. Contracts are considered to contain a single performance obligation if the promise to transfer individual goods or services is not separately identifiable from other promises in the contracts.

 

For contracts with multiple performance obligations, the Company allocates the transaction price to each performance obligation using the best estimate of the standalone selling price of each distinct good or service in the contract.

 

 

10.EARNINGS PER SHARE

 

The Company calculates net loss per share in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 260, “Earnings per Share”. Basic earnings (loss) per share is calculated by dividing income (loss) by the weighted average number of common shares outstanding for the period. During the periods presented, the Company only has common stock outstanding. In 2021, the Company issued a convertible debt instrument. In addition, the Company also has stock warrants of 954,000 and 994,000 as of July 31, 2023 and 2022, respectively. The Company has calculated diluted earnings per share utilizing the outstanding stock warrants and convertible debt.

 

 

11.INCOME TAXES

 

The Company accounts for income taxes in accordance with FASB ASC Topic 740 “Income Taxes”, which requires an asset and liability approach for financial reporting purposes.

 

Deferred income taxes are provided for differences between the tax bases of assets and liabilities and the financial reporting amounts at the end of the period, and for net operating loss and tax credit carryforwards available to offset future taxable income. Changes in enacted tax rates or laws result in adjustments to recorded deferred tax assets and liabilities in the periods in which the tax laws are enacted or tax rates are changed. The Company will continue to evaluate its income tax obligation throughout the year and will record a tax provision when it is necessary.

 

-9-

 

 

INNOVATIVE DESIGNS, INC.
NOTES TO FINANCIAL STATEMENTS
 

 

12.SHIPPING AND HANDLING COSTS

 

The Company pays shipping and handling costs on behalf of customers for purchased apparel merchandise. These costs are billed back to the customer through the billing invoice. The shipping and handling costs associated with merchandise ordered by the Company are included as part of inventory as these costs are allocated across the merchandise received. With house wrap orders, the customer pays the shipping cost. The shipping and handling costs associated with customer orders was approximately $27,070 and $21,199 for the nine month periods ended July 31, 2023 and 2022, respectively.

 

13.COMMON STOCK

 

During the nine month period ended July 31, 2023, the Company sold 645,000 shares of common stock to four investors for total proceeds of $131,000, one investor exercised 40,000 warrants for stock for total proceeds of $10,000, and 230,000 shares were issued to two investors for services. The stock was issued between $0.20 and $0.25 per share.

 

During the nine month period ended July 31, 2022, the Company sold 460,000 shares of common stock to seven investors for total proceeds of $86,200 and issued 750,000 shares to eight individuals for services. The stock was issued between $0.17 and $0.25 per share.

  

 

14.DEPOSITS ON EQUIPMENT

 

On July 12, 2015, the Company reached an agreement with Ketut Jaya to purchase the machinery and equipment utilized to produce the INSULTEX material. The purchase price is $700,000 and to be made in four installments. The first installment of $300,000 is to be made at the execution of the agreement. The second installment of $200,000 is to be made when the machinery and equipment is ready to be shipped to the United States. The third installment of $100,000 is to be made once the machinery and equipment is producing INSULTEX, and the fourth and final installment of $100,000 is to be made after the first commercial production run of INSULTEX is completed. As of October 31, 2018, the Company has made payments of $500,000 in accordance with the agreement and made a $100,000 pre-payment as the machine is not yet producing INSULTEX. Additionally, the Company has incurred $17,000 of additional expenses related to shipping, site improvements and installation of the equipment. During 2019, the Company determined the shipping costs of $17,000 were impaired and these costs were written off the balance due. In February 2023, the Company made an additional prepayment of $10,000 on the equipment and owes an additional $73,000 for the installation of the equipment.

 

During the fiscal year ending October 31, 2022, the Company made deposits on a separate piece of equipment of $7,370. During the three quarters ended July 31, 2023, the Company made additional deposits of $29,574 on this piece of equipment. Total deposits for this piece equipment as of July 31, 2023 total $36,944.

 

Total deposits made for the three quarters ended July 31, 2023 total $112,574.

 

-10-

 

 

INNOVATIVE DESIGNS, INC.
NOTES TO FINANCIAL STATEMENTS
 

 

Total overall deposits on equipment as of July 31, 2023 and 2022 were $719,944 and $607,370, respectively.

 

 

15.LEASE

 

FASB ASC Topic 842, “Leases”, establishes a right of use (“ROU”) model that requires a lessee to recognize a ROU asset and lease liability on the condensed balance sheets. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. ROU assets are reduced each period by an amount equal to the difference between the lease expense and the amount of interest expense on the lease liability, using the effective interest method. The Company used the average commercial real estate interest rate of 5.50% to calculate the present value of the lease. The Company recognizes lease expense on a straight-line basis over the leased term on the condensed statements of operations.

 

The Company entered into a lease for office space at the time the Company was formed through June 2022. Effective July 2022, the Company is leasing the office space on a month to month basis. As a result, the Company has elected to apply the short-term lease exemption to its lease of the facilities and therefore has not recorded a ROU asset and related lease liability.

 

 

16.SEGMENT INFORMATION

 

The Company has organized operations into two segments based on an internal management reporting process that provides segment information for purposes of making financial decisions and allocating resources.

 

The following tables present the Company’s business segment information for the nine month period ended July 31, 2023 and 2023:

 

          
   2023  2022
Revenues:          
Apparel  $31,105   $59,126 
House wrap   192,441    176,038 
           
Total revenues  $223,546   $235,164 
           
Assets:          
Apparel  $167,822   $81,045 
House wrap   1,318,342    1,546,171 
           
Total assets  $1,486,164    1,627,216 
           
Depreciation:          
Apparel  $   $ 
House wrap   2,306    1,118 
           
Total depreciation  $2,306   $1,118 

 

-11-

 

 

INNOVATIVE DESIGNS, INC.
NOTES TO FINANCIAL STATEMENTS
 

 

 

17.LEGAL PROCEEDINGS

 

On November 4, 2016, the Federal Trade Commission (“FTC”) filed a complaint against the Company in the U.S. District Court Western District of Pennsylvania, Case number 16-1669. In the complaint, the FTC alleges that, among other matters, the Company did not have substantiation of claims made by the Company regarding the R value and energy efficiency of its INSULTEX house wrap products. The complaint asks to redress a rescission of revenue the Company received from the sale of the house wrap and a permanent injunction. On September 24, 2020, a judgment was entered in favor of the Company as to all claims set forth in the FTC complaint. It was further ordered that as there were no remaining claims in the action the case shall be marked as closed.

 

On November 23, 2020, the Company was informed that the FTC had filed a notice of appeal in regard to the case. The appeal is from the District Court’s September 24, 2020, Order granting the Company’s Motion for Judgment on Partial Findings Pursuant to Fed. R. Civ. P. 52(c) and subsequent Judgment in favor of the Company and from the District Court’s February 14, 2020, striking Dr. David Yarbrough’s expert testimony made on behalf of the FTC. The FTC filed its appeal and on March 24, 2021, the Company filed its answer.

 

On July 22, 2021, the Registrant was informed that the U.S. Court of Appeals for the Third District affirmed the District Court’s ruling in favor of the Registrant. The ruling was in connection with the FTC complaint filed against the Registrant in November 2016, alleging, among other matters, that the Registrant did not have substantiation for claims made by the Registrant regarding the R-value and energy efficiency of its INSULTEX house wrap products.

 

In November 2021, in connection with the FTC litigation, the Company filed an application for attorney fees, expenses and cost in the U.S. District Court for the Western District of Pennsylvania, Case No.2:16-cv-01669-NBF. On June 29, 2022, a settlement order was signed by the Court. Pursuant to the Order, the FTC paid the Company $260,000 to resolve all such claims. The parties agreed to waive all rights to appeal or otherwise challenge or contest the validity of the Order.

 

 

18.SUBSEQUENT EVENTS

 

The Company has evaluated subsequent events in accordance with ASC Topic 855, “Subsequent Events”, through September 20, 2023 which is the date financial statements were available to be issued. The Company identified no material subsequent events that require recognition or additional disclosure in these financial statements.

 

 

-12-

 

 

  INNOVATIVE DESIGNS, INC.

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

General

 

The following information should be read in conjunction with the financial statements and the notes thereto and in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended October 31, 2022.

 

Forward-Looking Statements

 

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of the Private Securities Reform Act of 1995. All statements other than statements of historical fact, including statements regarding future results of operation, made in this Quarterly Report on Form 10-Q are forward-looking statements. We use words such as expects, believes, intends, and similar expressions to identify forward-looking statements. Forward looking-looking statements reflect management’s current expectations and are inherently uncertain. Actual results could differ materially for a variety of reasons, including, among others, an adverse outcome in our legal matter with the Federal Trade Commission, competition in our cold weather markets, our inability to secure sufficient funding to maintain and/or expand our current level of operations and the seasonality of our cold weather product line. These risks and uncertainties, as well as other risks and uncertainties that could cause our actual results to differ significantly from management’s expectations, are described in greater detail in our Annual Report on Form 10-K for the fiscal year ended October 31, 2017. The Company undertakes no obligation to publicity update or revise any forward-looking statement, whether as a result of new information, future events or otherwise except as required by law.

 

Background

 

Innovative Desings, Inc. (herein after referred to as the “Company”, “we” or “our”) was formed on June 25, 2002. We produce, market and sell products made from Insultex, which is a low-density polyethylene semi-crystalline, closed cell foam in which the cells are totally evacuated with buoyancy and thermal resistant properties. Other than Korea and Japan, we are the sole worldwide supplier/ distributor of the Insultex material. Our main product line is a house wrap, Insultex House Wrap, for the building construction industry. Insultex House Wrap is a multi-ply weatherization membrane that provides a protective layer under a building’s outer covering that resists water and air infiltration, preventing mold and mildew buildup that can cause structural rotting. What differentiates Insultex House Wrap from its competition is the fact that it offers an R-Value of R-6. R-value is a term used to measure thermal resistance and is most commonly used when referring to the insulating qualities of a building structure, thus increasing energy efficiency. We also sell a cold weather line of outdoor apparel and cold weather gear call Artic Armor made using Insultex. We no longer produce this line and are only selling from our remaining inventory. The fact that Insultex is a thermal insulation means it has many other applications such as other clothing apparel, tents and sleeping bags. It can also be used in refrigerated environments where keeping the temperature low is a requirement.

 

-13-

 

 

  INNOVATIVE DESIGNS, INC.

 

Results of Operations

 

Comparison of the Three Month Period Ended July 31, 2023 with the Three Month Period Ended July 31, 2022.

 

                Three Month Period Ended 31-Jul 2023         % of Sales         Three Month Period Ended 31-Jul 2022         % of Sales         Increase (Decrease)         % Change
                         
REVENUE - NET   $ 124,650.00             $ 135,048.00             $ -10,398.00       -8.3 %
                                                 
OPERATING EXPENSES                                                
 Cost of sales   $ 76,480.00       61.4 %   $ 56,224.00       41.6 %   $ 20,256.00       26.5 %
 Selling, general and                                                
 administrative expenses   $ 124,944.00       100.2 %   $ 115,384.00       85.4 %   $ 9,560.00       7.7 %
Total Operating Expenses   $ 201,424.00             $ 171,608.00                          
Loss from operations   $ -76,774.00       -61.6 %   $ -36,560.00       -27.1 %   $ -40,214.00       52.4 %
                                                 
Other income (expense)                                                
Miscellaneous Income (expense)   $ 0.00             $ 260,000.00       100.0 %   $ -260,000.00       100.0 %
 Interest expense   $ -6,421.00       -5.2 %   $ -10,710.00       -7.9 %   $ 4,289.00       -66.8 %
Depreciation   $ -769.00             $ -373.00       -0.3 %   $ -396.00       51.5 %
Total other income (expense)   $ -7,190.00             $ 248,917.00       184.3 %   $ -256,107.00       3562.0 %
Net Loss   $ -83,964.00       -7.4 %   $ 212,357.00       157.2 %   $ -296,321.00       352.9 %

 

Revenues for the three month period ended July 31, 2023 were $124,650 compared to revenues of $135,048 for the three month period ended July 31, 2021. See Note 16 of the Notes to the Condensed Financial Statements appearing elsewhere in this Report for a description of our segment products sales. Our net loss for the three-month period ended July 31, 2023, was ($83,964).

 

Our cost of sales was $76,480 for the three months ended July 31, 2023, compared to $56,224 for the three months ended July 31, 2022. The increase is largely on account of the increase in the price we pay to our supplier of the House Wrap product line.

 

Our selling, general and administrative expenses were $124,944 for the three month period ended July 31, 2023 compared to $115,384 for the three month period ended July 31, 2022.

 

-14-

 

 

  INNOVATIVE DESIGNS, INC.

 

Comparison of the Nine Month Period Ended July 31, 2023, with the Nine Month Period Ended July 31, 2022.

 

The following table shows a comparison of the results of operations between the nine month periods ended July 31, 2023 and July 31, 2022:

 

                Nine Month Period Ended 31-Jul 2023         % of Sales         Nine Month Period Ended 31-Jul 2022         % of Sales         Increase (Decrease)         % Change
                         
REVENUE - NET   $ 223,546.00             $ 235,164.00             $ -11,618.00       -5.2 %
                                                 
OPERATING EXPENSES                                                
Cost of sales   $ 106,839.00       47.8 %   $ 109,884.00       46.7 %   $ -3,045.00       -2.9 %
Selling, general and                                                
administrative expenses   $ 359,917.00       161.0 %   $ 545,212.00       231.8 %   $ -185,295.00       -51.5 %
Total Operating Expenses   $ 466,756.00             $ 655,096.00                          
Loss from operations   $ -243,210.00       -108.8 %   $ -419,932.00       -178.6 %   $ 176,722.00       -72.7 %
                                                 
Other income (expense)                                                
Miscellaneous Income (expense)   $ 7,519.00             $ 260,000.00       100.0 %   $ -252,481.00       100.0 %
 Interest expense   $ -17,652.00       -7.9 %   $ -34,450.00       -14.6 %   $ 16,798.00       -95.2 %
Depreciation   $ -2,306.00             $ -1,118.00       -0.5 %   $ -1,188.00       51.5 %
Total other income (expense)   $ -12,439.00             $ 224,432.00       95.4 %   $ -236,871.00       1904.3 %
Net Loss   $ -255,649.00       -114.4 %   $ -195,500.00       -83.1 %   $ -60,149.00       23.5 %

 

Revenues for the nine month period ended July 31, 2023 were $223,546 compared to revenues of $235,164 for the nine month period ended July 31, 2021. The decrease is caused, by the decrease in our apparel sales and the sales in our House Wrap product line. The apparel sales were adversely affected by warm weather. During the nine month period ended July 31, 2023 House Wrap sales totaled $192,441 in comparison with $176,038 during the nine month period ended July 31, 2022. See Note 16 of the Notes to the Condensed Financial Statements appearing elsewhere in this Report for a description of our segment product sales. Our net loss for the nine month period ended July 31, 2023 was ($255,649).

 

Our selling, general and administrative expenses were $106,839 for the nine months ended July 31, 2023, compared to $109,884 for the nine month period ended July 31, 2022. Professional fees for the period were approximately $63,000. Salaries were approximately $107,000, travel expenses were approximately $20,000 and rent expense was $21,000.

 

-15-

 

 

  INNOVATIVE DESIGNS, INC.

 

Liquidity and Capital Resources

 

During the period ended July 31, 2023, we funded our operations from revenues and from sales of our securities.

 

Subsequent to the period we raised $60,000 from the sale of our securities.

 

Short Term: We will continue to fund our operations from sales and the sale of our securities. We continue to pay our creditors when payments are due. We will require more funds to be able to order the material for our Insultex products and to purchase equipment needed for the manufacture of the Insultex product. The Company reached an agreement with the manufacturer of the Insultex material to purchase a machine capable of producing the Insultex material. Also included in the proposed agreement will be the propriety formula that creates Insultex. The Company took delivery of the equipment in December 2015. The Company will have to have the machine installed and ensure that it can be operated in compliance with all environmental rules and regulations. It is the Company intentions to have the equipment operational but cannot currently provide a time estimate. Among the factors affecting the time estimate are the financial resources available to the Company, finding a suitable facility and bringing technical personnel from abroad to install the equipment. The Company has currently made deposits of $600,000 on the equipment. The Company has incurred $17,000 of additional expenses related to shipping. Earlier this year, our CEO traveled to Indonesia to inspect the manufacturing facility of the Ketut Group where Insultex is currently produced. He also discussed with Ketut management the plans for the Company to install in the United States the machinery and equipment utilized to produce the Insultex material and for Ketut to arrange for the technical personal needed to assist in the installation. The Company is currently looking for a suitable site for the onshore manufacturing of Insultex. It is also seeking the financing needed to accomplish the installation which is estimated to cost between 1.5 to 2 million dollars.

 

The Company will produce Insultex under its own brand name. See Note 14 of the Notes to the Condensed Financial Statements.

 

We must purchase new quality control testing equipment for our products. The vendor is currently working on the project and we expect delivery of the equipment within the next few weeks. After such testing is complete the certification process can begin. We have paid approximately $39,000 as of July 31, 2023, for the equipment.

 

Long Term: The Company will continue to fund its operations from revenues, borrowings from private parties and the possible sale of our securities. Should we not be able to rely on the private sources for borrowing and /or increased sales, our operations would be severely affected as we would not be able to fund our purchase orders to our suppliers for finished goods and our efforts to produce our own Insultex would be delayed.

 

-16-

 

 

  INNOVATIVE DESIGNS, INC.

 

PART II – OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDING

 

See Note 17 of the Notes to Condensed Financial Statements appearing elsewhere in this Report.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

On May 17, 2023, we issued 185,000 shares of our common stock to a consultant for services pursuant to an agreement dated April 17, 2023. Also on May 17, 2023, we sold 50,000 Units to one investor at a price of $.20 per Unit. Each Unit contained one share of common stock and a warrant with a two year term to purchase one share of common stock. The  warrant has an exercise price of $.20 per warrant. We received $10,000 in proceeds.

 

On June 2, 2023, , we sold 40,000 Units each to one investors at a price of $.25 per Unit. The warrant had an exercise price of $.25. We received $10,000 in total proceeds.

 

On June 23, 2023, a warrant holder exercised warrants to purchase 40,000 shares of common stock at an exercise price of $.25. We received $10,000 in proceeds.

 

Between August 16, 2023, and August 24, 2023, we sold a total of 180,000 Unites to five investors at a price of $.25 per Unit. The warrant had an exercise price of $0.25 per warrant. Total proceeds were $45,000.

 

On September 6, 2023, we sold 20,000 Units each to three investors at a price of $.25 per Unit. The warrant had an exercise price of $.25 per warrant.

 

We relied on Rule 506 of Regulation D promulgated under the Securities Act of 1933, as amended.

 

-17-

 

 

  INNOVATIVE DESIGNS, INC.

 

ITEM 3.  QUANTITATATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

As a smaller reporting company, we are not required to provide the information otherwise required by this Item.

 

ITEM 4T.    CONTROLS AND PROCEDURES

 

Management has developed and implemented a policy and procedures for reviewing, on a quarterly basis, our disclosure controls and procedures. During the period ended July 31, 2023, our principal executive/financial officer concluded that these controls and procedures were ineffective. At this time, we do not have the financial resources to employ a financial staff with accounting and financial expertise. Once we have the necessary financial resources, we plan to hire and designate an individual responsible for identifying reportable developments and to implement procedures designed to remediate the material weakness by focusing additional attention and resources in our internal accounting functions.

 

Changes in Internal Control Over Financial Reporting

 

During the most recent fiscal quarter, there were no changes in the Company’s internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rules 13(a)-15 or 15d-15 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

 

Until the Company has the financial resources to employ a financial staff with accounting and financial expertise, to be able to properly account for internal financial reporting, errors that may have a material effect on the financial statements have the potential to occur.

 

-18-

 

 

  INNOVATIVE DESIGNS, INC.

 

ITEM 6. EXHIBITS

 

*3.1   Revised Certificate of Incorporation
     
**3.2   By-Laws
     
31.1   Rule 13a - 14a Certification of Chief Executive Officer and Chief Financial Officer
     
31.2   Rule 13a-14a Certification of Chief Executive Officer and Chief Financial Officer
     
32.1   Section 1350 Certification of Chief Executive Officer and Chief Financial Officer
     
31.2   Section 1350 Certification of Chief Financial Officer and Chief Accounting Officer

 

*Incorporated by reference to the Company’s Form 10-K filed February 12, 2015
   
**Incorporated by reference to the Company’s registration statement on Form SB-2, filed March 11, 2003
   
99***Incorporated by reference to the Company’s Current Report on Form 8-k, filed November 4, 2016

 

-19-

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  Innovative Designs, Inc.
  Registrant
   
Date: September 27, 2023 By: /s/ Joseph Riccelli
  Joseph Riccelli, Chief Executive Officer
  and Chief Financial Officer

 

-20-

 

 

 

 

EXHIBIT 31.1

INNOVATIVE DESIGNS, INC.

CERTIFICATIONS

 

I, Joseph Riccelli, certify that:

 

1.         I have reviewed this amended quarterly report on Form 10-Q/A of Innovative Designs, Inc.;

 

2.         Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

 

3.         Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

 

4.         I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have:

 

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this quarterly report is being prepared;

 

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this quarterly report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.         I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: September 27, 2023 By:/s/ Joseph Riccelli 
  Joseph Riccelli
  Chief Executive Officer 

 

 

 

 

 

EXHIBIT 31.2

 

INNOVATIVE DESIGNS, INC.

CERTIFICATIONS

 

I, Joseph Riccelli, certify that:

 

1.        I have reviewed this amended quarterly report on Form 10-Q/A of Innovative Designs, Inc.;

 

2.        Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

 

3.        Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

 

4.        I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this annual report is being prepared;
   
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
   
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this annual report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
   
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.        I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
   
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: September 27, 2023 By: /s/ Joseph Riccelli
    Joseph Riccelli
    Chief Financial Officer, Principal Accounting Officer

 

 

 

 

 

EXHIBIT 32.1

SECTION 906 CERTIFICATION

 

CERTIFICATION REQUIRED BY

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE

SARBANES-OXLEY ACT OF 2002

 

In connection with the amended quarterly report of Innovative Designs, Inc. (the “Company”) on Form 10-Q/A for the quarterly period ended July 31, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: September 27, 2023 By:/s/ Joseph Riccelli 
  Joseph Riccelli
  Chief Executive Officer, Chief
  Financial Officer, Principal
  Accounting Officer and Director

 

 

 

 

 

EXHIBIT 32.2

 

SECTION 906 CERTIFICATION

 CERTIFICATION REQUIRED BY

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE

SARBANES-OXLEY ACT OF 2002

 

In connection with the amended quarterly report of Innovative Designs, Inc. (the “Company”) on Form 10-Q/A for the quarterly period ended July 31, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
   
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: September 27, 2023 By: /s/ Joseph Riccelli
    Joseph Riccelli
    Chief Executive Officer, Chief
    Financial Officer, Principal
    Accounting Officer

 

 

v3.23.3
Cover - shares
9 Months Ended
Jul. 31, 2023
Sep. 22, 2023
Cover [Abstract]    
Document Type 10-Q/A  
Amendment Flag true  
Amendment Description Please note the Company is filing this form 10-Q/A to correct an inadvertent tag of shell status as being true instead of false in its Ixbrl tagging.  
Document Quarterly Report true  
Document Transition Report false  
Document Period End Date Jul. 31, 2023  
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2023  
Current Fiscal Year End Date --10-31  
Entity File Number 000-51791  
Entity Registrant Name INNOVATIVE DESIGNS, INC.  
Entity Central Index Key 0001190370  
Entity Tax Identification Number 03-0465528  
Entity Incorporation, State or Country Code DE  
Entity Address, Address Line One 124 Cherry Street  
Entity Address, City or Town Pittsburgh  
Entity Address, State or Province PA  
Entity Address, Postal Zip Code 15223  
City Area Code (412)  
Local Phone Number 799-0350  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Non-accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   36,417,560
v3.23.3
CONDENSED BALANCE SHEETS (UNAUDITED) - USD ($)
Jul. 31, 2023
Oct. 31, 2022
CURRENT ASSETS:    
Cash $ 178,817 $ 263,293
Accounts receivable, net 82 11,203
Inventory, net 588,874 494,580
Total current assets 767,773 769,076
PROPERTY AND EQUIPMENT, net 24,247 5,960
OTHER ASSETS:    
Inventory on consignment 0 1,625
Deposits on inventory 0 80,000
Advance to employees 13,200 13,200
Deposits on equipment 719,944 607,370
Total other assets 733,144 702,195
TOTAL 1,525,164 1,477,231
CURRENT LIABILITIES:    
Accounts payable 275,487 162,063
Current portion of note payable 20,265 20,128
Accrued interest of stockholder loans 54,073 46,345
Current portion of stockholder loans 71,668 110,631
Accrued expenses 3,778 3,778
Total current liabilities 425,271 342,945
LONG-TERM LIABILITIES:    
Long-term portion of note payable 49,530 64,547
Long-term portion of stockholder loans 0 66,667
Total long-term liabilities 49,530 131,214
STOCKHOLDERS’ EQUITY:    
Preferred stock, $0.0001 par value, 25,000,000 shares authorized 0 0
Common stock, $0.0001 par value, 100,800,000 shares authorized, and 36,092,560 and 34,650,560 issued and outstanding 3,612 3,467
Common stock to be issued
Additional paid-in capital 11,637,980 11,335,184
Accumulated deficit (10,591,228) (10,335,579)
Total stockholders’ equity 1,050,363 1,003,072
TOTAL $ 1,525,164 $ 1,477,231
v3.23.3
CONDENSED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares
Jul. 31, 2023
Oct. 31, 2022
Statement of Financial Position [Abstract]    
Preferred stock par value $ 0.0001 $ 0.0001
Preferred stock authorized 25,000,000 25,000,000
Common stock par value $ 0.0001 $ 0.0001
Common stock authorized 100,800,000 100,800,000
Common stock issued 36,092,560 34,650,560
Common stock outstanding 36,092,560 34,650,560
v3.23.3
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($)
3 Months Ended 9 Months Ended
Jul. 31, 2023
Jul. 31, 2022
Jul. 31, 2023
Jul. 31, 2022
Income Statement [Abstract]        
REVENUES, net $ 124,650 $ 135,048 $ 223,546 $ 235,164
OPERATING EXPENSES:        
Cost of sales 76,480 56,224 106,839 109,884
Selling, general and administrative expenses 124,944 115,384 359,917 545,212
Total operating expenses 201,424 171,608 466,756 655,096
Income (loss) from operations (76,774) (36,560) (243,210) (419,932)
OTHER INCOME (EXPENSE):        
Miscellaneous income (expense) 0 260,000 7,519 260,000
Interest expense (6,421) (10,710) (17,652) (34,450)
Depreciation (769) (373) (2,306) (1,118)
Total other income (expense) (7,190) 248,917 (12,439) 224,432
Net income (loss) $ (83,964) $ 212,357 $ (255,649) $ (195,500)
PER SHARE INFORMATION - UNDILUTED:        
Net income (loss) per common share $ (0.002) $ 0.006 $ (0.007) $ (0.006)
Weighted average number of common shares outstanding 35,656,821 33,845,560 35,339,663 33,845,560
PER SHARE INFORMATION - DILUTED:        
Net income (loss) per common share $ (0.002) $ 0.006 $ (0.007) $ (0.006)
Weighted average number of common shares outstanding 36,633,430 34,902,893 36,153,406 34,902,893